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Technology Stocks : Stock Swap
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To: Andrew Vance who wrote (15548)9/29/1998 4:59:00 PM
From: Justa Werkenstiff  Read Replies (1) of 17305
 
Andrew: I have an idea to brainstorm with you. I see the possibility of a DRAM shortage developing so pinch me and bring me down to earth <GG>:

1. Many DRAM players are packing their bags. There is a herd mentality now to get out of the business. After all is said and done, it looks like we will be left with four or five major players. I see a greater probability with this scenario that prices will at least stabilize. Human nature is such that the fewer the number of players there are, the less likely one player will cut prices to get market share and the more likely that a cartel psychology can develop which can actually increase prices.

2. MU is already the low cost producer. If it has ready access to capital, it will continue to push the technology down to the lowest micron economically viable to increase yields and profits. If you are another player, you are going to have to upgrade your equipment or die. MU is, in effect, accelerating the reorganization of the DRAM market. In this environment marginal players will drop out faster and the possibility for shortages increases.

3. INTC and TI must see this as they are trying to align themselves to benefit from or counteract this trend.

4. New players or sponsors with capital may enter if the shortage develops to play or provide financing.

5. The semi-equips recover and prosper.

6. I am a rich man.

Help me, I think I am losing my mind <GG>>
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